Why Twenty One’s Initial Decline Reflects Decreased Interest in BTC Companies

Key insights

• Twenty One Capital’s debut on the NYSE experienced nearly a 20% decrease, reflecting a cautious sentiment among investors regarding Bitcoin-centric public offerings.

• XXI traded close to its net asset value, indicating that the market did not assign a significant premium over the value of the firm’s Bitcoin assets.

• The downturn mirrored broader market challenges, such as Bitcoin volatility, diminishing enthusiasm for SPAC-backed listings, and declining mNAV premiums.

• This subdued response implies that investors might now expect Bitcoin-centric companies to demonstrate clear and sustainable revenue models instead of primarily depending on substantial BTC holdings.

The public launch of Twenty One Capital, a closely monitored Bitcoin-focused entity, on the New York Stock Exchange (NYSE) was greeted with cautious investor sentiment. Trading under ticker XXI, the company’s stock dropped nearly 20% on its inaugural day.

This article delves into what the market response may signify about changing investor preferences, the diminishment of the mNAV premium, and the increased scrutiny facing equity listings backed by Bitcoin.

Understanding Twenty One Capital

Twenty One Capital is an institutionally backed, Bitcoin-native public entity with the ambition of becoming the largest publicly traded owner of Bitcoin (BTC). The firm went public through a special-purpose acquisition company (SPAC) merger with Cantor Equity Partners and trades under the ticker XXI.

At the time of its launch, the company reported a treasury of over 43,500 BTC, valued at approximately $3.9 billion-$4.0 billion, making it one of the largest corporate holders of Bitcoin.

The company was created with a distinct focus: a corporate framework that prioritizes Bitcoin in its strategy. Its founders and investors aim for the firm to be more than just a treasury vehicle. Jack Mallers, who also founded Strike, mentioned that Twenty One aspires to establish corporate infrastructure for Bitcoin-aligned financial products.

This approach positions Twenty One alongside other digital asset treasury (DATs) firms but with notable distinctions. Its backers include Cantor Fitzgerald, a primary dealer for the Federal Reserve; Tether, the issuer of USDt (USDT) and a major holder of US Treasurys; Bitfinex; and SoftBank. These influential partnerships place Twenty One as one of the most robustly backed Bitcoin-native companies to go public.

The firm emerged amid a wider trend of publicly traded companies pursuing Bitcoin-centric strategies, partly influenced by the expansion model of Strategy (formerly MicroStrategy). However, Twenty One’s intention is not simply to replicate that model, but to aim for revenue-driven growth while maintaining a substantial Bitcoin reserve.

The launch and the significant price decline

Given the size of its treasury and the profile of its backers, many market observers anticipated significant interest surrounding Twenty One’s launch. However, the stock fell dramatically on its first day of trading on Dec. 9, 2025, despite the company’s considerable Bitcoin assets and notable institutional backing.

When Cantor Equity Partners’ SPAC shares converted to XXI, the new stock opened at $10.74, below the SPAC’s previous close of $14.27. After-hours trading indicated only a slight recovery. At the end of its inaugural trading day, shares were down roughly 19.97%, settling at $11.96.

This performance highlighted a broader trend where newly listed crypto-related companies often trade below their pre-merger benchmarks. Moreover, the public equity was trading at a discount compared to its underlying cryptocurrency assets, suggesting that valuation dynamics for such stocks may be changing.

Investor caution and Twenty One’s slide on the NYSE

The sharp drop in Twenty One Capital’s stock price was not an isolated occurrence. It reflected the convergence of three market factors during late 2025:

• Decline of the multiple-to-net-asset-value (mNAV) premium

• Ongoing volatility within crypto markets

• Diminished sentiment towards SPAC-driven public listings.

Interpreting the muted mNAV valuation

A clear indicator of market apprehension was that the stock did not trade at a significant premium to the value of its Bitcoin assets. This is typically evaluated using the mNAV ratio.

Historically, Bitcoin treasury firms have commanded a considerable mNAV premium at various points in past market cycles. That premium has often been interpreted as a sign of investor confidence in management’s capability to generate value beyond just the underlying assets.

However, Twenty One Capital traded at or near its asset value, effectively assigning little to no premium to its business intentions or management. This indicated that the market was valuing the stock primarily as a direct and potentially volatile proxy for Bitcoin rather than factoring in a distinct operating-business premium.

Market volatility and SPAC sentiment

Twenty One Capital debuted during a challenging time for both the cryptocurrency market and SPAC-driven offerings. Leading up to the launch, cryptocurrencies encountered significant selling pressure. Bitcoin had decreased over 28% from its peak in October, fostering a risk-averse environment where investors were reluctant to impose generous valuations on crypto-linked stocks.

The merger with Cantor Equity Partners represented a SPAC-driven method for going public. While the anticipation of the deal previously led to sharp increases in the SPAC’s shares, enthusiasm for high-profile crypto SPACs had waned by late 2025. A lengthy history of underperformance post-merger has contributed to investor fatigue and skepticism, causing new public companies to often trade below their pre-merger benchmarks.

Did you know? The equity trading below the value of its Bitcoin treasury exemplifies a valuation paradox, where a newly public stock is priced at a discount relative to the market value of its primary liquid assets.

Market evolution: Demand for established business models

Another factor motivating investor caution may be the absence of a well-defined, revenue-generating operating model at the time of debut. This suggests that some investors are moving away from pure “Bitcoin treasury” narratives, emphasizing differentiation and reliable cash flows instead.

Twenty One Capital went public with substantial Bitcoin holdings, yet lacked a detailed, publicly available business strategy or confirmed timeline. The launch also coincided with increased scrutiny of the digital asset treasury company sector.

As reported by Reuters, analysts indicate that capital raising is becoming “harder for DATs” and that companies “need to demonstrate material differentiation” to justify their trading multiples.

The significant decline in XXI’s share price may suggest that the market’s viewpoint is evolving. Some investors could be shifting their emphasis to a company’s capacity to implement a sustainable business model alongside its assets. Public markets may increasingly favor firms capable of generating predictable cash flows over those that primarily hold Bitcoin.